Ministry of Finance of the Russian Federation
Ministry of Finance of the Russian Federation
25.02.2004

PRESS RELEASE The Ministry of Finance of the Russian Federation launched an offer to exchange Russian Federation Eurobonds due 2006 to 2010 and Russian Federation Eurobonds due 2007 to 2030 for former USSR debt owed by The Bank for Foreign Affairs of the USSR (Vnesheconombank) to the International Bank for Economic Co-operation (IBEC) and the International Investment Bank (IIB)

 

Moscow, February 25. The Ministry of Finance of the Russian Federation today launched an offer to exchange Russian Federation Eurobonds due 2006 to 2010 and Russian Federation Eurobonds due 2007 to 2030 for former USSR debt owed by The Bank for Foreign Affairs of the USSR (Vnesheconombank) to the International Bank for Economic Co-operation (IBEC) and the International Investment Bank (IIB). The Ministry of Finance of the Russian Federation also announced that IBEC and IIB have today simultaneously offered to exchange former USSR debt owed by Vnesheconombank to IBEC and IIB for a like principal amount of IBEC and IIB debt held by IBEC and IIB’s foreign creditors. The Vnesheconombank debt received by IBEC and IIB’s foreign creditors pursuant to IBEC and IIB’s exchange offer will be automatically and simultaneously exchanged for 2030 Bonds and 2010 Bonds pursuant to Russian Federation’s exchange offer. Based on today’s exchange rates, U.S. $ 213.58 million principal amount of IBEC debt and U.S. $ 236.87 million principal amount of IIB debt is eligible to participate in IBEC and IIB’s exchange offer.

The Ministry of Finance’s authority to launch the exchange offer is not affected by President Putin’s dismissal of the Russian Government yesterday.

The terms of both exchange offers were previously agreed in principle with the consultative working groups of IBEC and IIB creditors, chaired by Lloyds TSB Bank, and are similar to the terms offered in the Russian Federation’s August 2000 London Club restructuring and December 2002 restructuring of trade debt of the former USSR.

The 2010 Bonds and 2030 Bonds to be issued in the Russian Federation’s exchange offer will accrue interest from March 31, 2000 and will be fungible in all respects with Russia’s outstanding 2010 Bonds and 2030 Bonds. The 2010 Bonds provide for the payment of 9.5% of their initial principal amount on the date of issue. Except as otherwise provided in the Russian Federation’s exchange offer, participating creditors will, in addition, receive all of the interest payments that would have been made on their 2010 Bonds and their 2030 Bonds if such bonds had been issued in connection with the Russian Federation’s August 2000 London Club restructuring.

Detailed terms of the exchange offer are contained in the Offering Circular for the exchange offer. Copies of the Offering Circular have been sent to all eligible foreign holders of IBEC and IIB debt.

The exchange offer will remain open until 5 p. m., London time, on Friday, March 5, 2004. It is expected that the exchange offer will close on Tuesday, March 16, 2004.


NOT FOR RELEASE IN THE UNITED STATES. These materials are not an offer for sale of the securities in the United States. The securities may not be offered or sold in the United States absent registration or an exemption from registration under the Securities Act of 1933, as amended. The Russian Federation does not intend to register the securities in the United States or to conduct a public offering of securities in the United States.